ECONOMIC BRIEFING REPORT A detailed summary of trading conditions, consumer demand, and how the UK economy is performing. GDP, inflation, input prices, labour market, wider economic situation Weather, footfall, number of visitors to e- commerce websites Retail sales, consumer confidence, and consumer purchasing power INSIGHT April 2021
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ECONOMIC BRIEFING REPORT
A detailed summary of trading conditions, consumer demand, and how the UK economy is performing.
GDP, inflation, input prices, labour market, wider economic situation
Weather, footfall, number of visitors to e-commerce websites
Retail sales, consumer confidence, and consumer purchasing power
INSIGHT
April 2021
I N S I G H T
GDP GROWTH CPI INFLATION
UNEMPLOYMENT WAGE GROWTH
BRC – KPMG RETAIL SALES CONSUMER CONFIDENCE
MENU
The GFK index rose 1 point in April to -15 from -16 in March.
April 2021
-15
Up from 4.3% in January.
% change – YOY February 2021
4.4%
Down from 0.4% in February.
% change - YOY March 2021
0.7%
Up from 1.0% in February.
% change – YOY, March 2021
13.9%
Down from 5.0% in January.
February 2021
4.9%
Up from -2.2% in January.
% change – MoM, February 2021
0.4%There are renewed hopes that the UK economy will see a robust economic rebound. Despite the national lockdown,
February’s economic performance was improved as businesses continued to adapt to operating within health
restrictions and to new border rules.
It is estimated that UK households have amassed around
£160bn in savings since the pandemic started to February. It’s not clear what proportion will be spent, as
those are concentrated in the higher income households, while lower income ones had a negative shock to their
income since the pandemic started. Moreover, the uncertain economic outlook might encourage people to hold on to their savings.
There are some promising signs that the tax reduction incentive by the government for companies that
accumulate capital is working, with investment decisions by firms reaching their highest since July 1997. This
would drive up employment and generate long-term growth.
There are renewed hopes that the UK will see a quick economic rebound.
UK monthly GDP rose by 0.4% in February, up from -2.2% in January, although below market expectations of 0.6%. Despite the national lockdown, February’s economic performance was improved as businesses continued to adapt to operating within health restrictions and to new border rules. However, UK output remains 7.8% below February’s 2020 level. With the country still in lockdown in February, growth was anticipated to be subdued.
The service sector increased by 0.2%, driven mainly by growth in the wholesale and retail industry. Overall, consumer-facing services sectors remained well below pre-pandemic levels (see Figure). That is expected to change in Q2 as restrictions start to ease. The combination of the successful vaccination campaign, built-up savings and improved sentiment in the economy is thought to unlock household spending leading to a fast economic rebound.
The big question remains how much of the accumulated savings will be spent.
It’s estimated that UK households have amassed around £160bn since the
pandemic started to February. The OBR estimates that savings will have increased by £180bn between Mar-20 and June-21. This is an astounding figure
by historical standards, amounting to almost 10% of last year’s GDP. In Q4,
household savings ratio rose by 16.1%, the second highest ratio since records began in 1963 — just behind the Q2 2020 figure of 25.9%.
Most agree that the initial relaxation of restrictions will trigger some “euphoria”, as many people have waited to treat themselves. The bigger question, on which there is no consensus, is whether we will see a consumption frenzy longer-term.
As significant uncertainties persist and there is no similar precedent, it’s difficult to make firm predictions.
GDP, MONTHLY INDEX OF SERVICES, FEB-20 = 100
2UK ECONOMY
PROJECTIONS FOR 2021 UK GDP GROWTH
One source of uncertainty is around the differentiated Covid impacts on incomes, with households in the top 40% of the income distribution and retired households seeing a marked increase in savings, and households in the bottom 40% experiencing a fall in savings. Economic models suggest that 5-10% of unexpected income would be spent over the following year. However, wealthier people are less likely to spend their savings. And spending likelihood decreases further if, in the meanwhile, these households have converted their savings from cash to pensions or financial investments.
Another unknown is whether people will feel the need for a safety net for the future. It’s now clear that Covid will be part of our lives for the next few years. The prospect of new variants might mean that some will want to insure themselves against a highly uncertain future by keeping a comfortable level of savings.
Finally, some people, aware of potential health risks, will be reluctant to go out. There are no estimates about how large the proportion of this population is in a scenario where vaccination has been rolled out.
With BRC-KPMG non-food sales falling by 4.7% over the three months to March (compared to 2 years ago), retail will welcome a splash in consumer spending. Time will tell whether caution or a more risky approach to spending will prevail. Some preliminary data are positive. ONS reports that in the week to 22/04, total credit and debit card purchases rose by 7 percentage points from the previous week to 98% of its February 2020 average, driven mainly by a continued increase in 'delayable' spending, up 21 percentage points from the previous week following the re-opening of non-essential retail stores in England and Wales on 12 April 2021. Both 'staples' and 'delayable' spending were above their February 2020 level at 111% and 110%, respectively. Conversely, 'social' and 'work-related' spending were at 71% and 96% of their average levels in February 2020, respectively.
There are also encouraging signs from the production side of the economy. The
IHS Markit March PMI (Purchasing Managers’ Index), a gauge of private sector
activity, showed that business activity grew at its fastest rate since last August, above expectations and following two months of decline. Companies reported an
influx of new orders on a scale exceeded only once in almost four years, and
business expectations for growth in the year ahead surged to the highest since comparable data were first available in 2012.
The CBI Quarterly Industrial Trends Survey found that, in the quarter to April, firms expected to increase capital expenditureon buildings, plant & machinery,
product & process innovation, with investment intentions for plant & machinery at
their strongest since July 1997. The new super-deduction announced in the March budget which will cut companies’ tax bill by 25p for every pound invested in new
equipment is likely to be driving this. New investment is likely to drive up
employment and generate long-term growth. The furloughing scheme is due to expire at the end of September. One can only hope that an “investment-led
recovery” will take off.
Dr. Liliana Danila, Economist
4.0%
OBR (Mar Forecast)
3.4%
IMF (Apr Forecast)
5.3%
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
40
50
60
70
80
90
100
110
Feb 20 Mar 20 Apr 20 May 20 Jun 20 Jul 20 Aug 20 Sep 20 Oct 20 Nov 20 Dec 20 Jan 21 Feb 21
Index of Services Consumer facing services All other services
• The share of Wholesale and Retail companies reporting decreased
turnover on the year has been declining since February, while the
proportion of companies that report unaffected turnover has been
increasing since December.
• Over the period 23/03 – 4/04, of the surveyed Wholesale and Retail
businesses, 13% reported higher turnover than normal expectations
at this time of the year, 42.2% turnover unaffected (highest
proportion since Jun-20 when collection of this data series started)
and 36% decreased turnover (the lowest share since Jun-20).
WHOLESALE AND RETAIL ONLINE JOB ADS
• In Wholesale and Retail, the proportion of online job ads was 18%
higher in April than in March. However, that remains 19% lower than
the level seen in February 2020.
• In the UK as a whole, on April 23rd, the proportion of total UK online
job adverts was at 103% of its average February 2020 level. This is 4
percentage points higher than the previous week and the first time it
has exceeded its February 2020 average level since 6 March 2020.
SPENDING ON DEBIT AND CREDIT CARDS
• In the week to 22/04, total credit and debit card purchases rose by 7 percentage points from the previous week to 98% of its February 2020 average.
• This was mainly driven by a continued increase in 'delayable' spending, up 21 percentage points from the previous week following the re-opening of non-essential retail stores in England and Wales on 12 April 2021.
• 'Work-related' spending increased by 8 percentage points. • Both 'staples' and 'delayable' spending were above their February
2020 level at 111% and 110%, respectively. • Conversely, 'social' and 'work-related' spending were at 71% and
96% of their average levels in February 2020, respectively.
3UK – COVID-19 IMPACT
SUMMARYTURNOVER IMPACT
SPENDING ON DEBIT AND CREDIT CARDS
Source: ONS.
“Staples” and “delayable” spending were above their February 2020 level in the week to 22/04.
WHOLESALE AND RETAIL ONLINE JOB ADS, Feb-20= 100, ADZUNA
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
0
20
40
60
80
100
120
140
160
Jan Feb Mar Apr May Jun Jul Sep Oct Nov Dec
2019 2020 2021
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Increased by more than 20% Increased by up to 20%Unaffected Decreased by up to 20%Decreased between 20% and 50% Decreased by more than 50%
Monthly 3m rolling avg LFL 3m rolling average total
Date LFL Total Food Non-Food Total FoodNon-Food
Total
Mar-20 -3.5 -4.3 4.9 -6.7 -1.3 5.1 -6.6 -1.4
Apr 5.7 -19.1 6.0 -4.4 0.3 4.5 -17.5 -7.5
May 7.9 -5.9 8.7 -2.1 2.8 5.6 -21.8 -9.4
Jun 10.9 3.4 7.3 9.5 8.4 3.8 -15.0 -6.4
Jul 4.3 3.2 8.2 7.9 7.9 6.1 -4.3 0.4
Aug 4.7 3.9 6.3 7.7 7.0 5.9 1.4 3.5
Sep 6.1 5.6 5.1 5.2 5.1 5.6 3.2 4.3
Oct 5.2 4.9 5.2 5.7 5.4 5.8 4.0 4.9
Nov 7.7 0.9 6.4 6.4 6.3 7.0 1.3 3.9
Dec 4.8 1.8 6.8 5.1 5.8 7.3 -1.5 2.5
Jan 7.1 -1.3 7.5 5.6 6.4 7.9 -5.6 0.6
Feb 9.5 1.0 7.6 6.6 7.0 7.9 -5.5 0.6
Mar-21 20.3 13.9 5.7 19.5 12.9 6.6 4.2 5.3
Now that we have begun to annualise against the beginning of the coronavirus crisis period in
March 2020, analysing year on year figures has proved challenging, as the comparable conditions from last year are not a representative basis point. Therefore, the headline rates in
this report are calculated comparing this month’s performance against the same month from 2019.
On a Total basis, in March retail sales increased 8.3% from the level seen at the same point in
2019. This was an encouraging result, given the continued store closures over the course of the month. The easing of social restrictions in the final week of the month, coupled with Easter
moving back into March for the month stimulated a release of pent-up demand in the market, which boosted sales significantly. However, the headline growth rate masks underlying
challenges in many categories, out of the 13 categories tracked in this report, 8 remained in significant decline. The pandemic has concentrated spend on home centric categories such as
food, computing and home appliances. While others, such as fashion and beauty remain in double digit decline compared to pre-pandemic levels.
On a two-year basis, the categories to see the strongest performances during the month
followed the trajectories seen over the course of the coronavirus crisis period so far, with those related to indoor products still outperforming those in fashion. As the current lockdown
continued for yet another month this result is hardly a surprise, as consumers are still spending the vast majority of their time at home even though the clocks changed during the month,
giving more time to enjoy the outdoors. Also, as people are yet to return to the office, home computing goods were once again in demand.
All eyes are now firmly on the much-heralded reopening of stores, given the roll-out of the
vaccination programme and the ever-reducing infection rate. It is widely anticipated that this will lead to a glut of activity returning to the high street, especially as other entertainments
remain off limits. However, the recovery could be significantly dampened if ’health passport’ requirements are enforced.
With little alternative for consumers for the second consecutive month, the Online channel saw
another month of stellar growth, albeit narrowly missing the record-setting pace from January. The impending return of non-essential stores to the retail landscape was still too far in the
future to lead people to put off purchases before seeing the goods beforehand, but it remains to be seen whether this will impact sales in March as the reopening date approaches.
ALL EYES ON STORES AS THEY REOPEN
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
5
Food sales continued to see robust sales in March, despite the high comparable of a year ago.
4.2%Non-Food Sales
Up from -5.5% in February.
13.9%Retail Sales
Up from 1.0% in February.
SUMMARY MARCH
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
Mar-
18
May
-18
Jul-
18
Sep-
18
Nov
-18
Jan
-19
Mar-
19
May
-19
Jul-
19
Sep-
19
Nov
-19
Jan
-20
Mar-
20
May
-20
Jul-
20
Sep-
20
Nov
-20
Jan
-21
Mar-
21
% c
hang
e Yo
Y
BRC/KPMG RSM total ONS Retail Sales (value, nsa)
-2%
0%
2%
4%
6%
8%
10%
Mar
-18
May
-18
Jul-
18
Sep-
18
Nov
-18
Jan
-19
Mar
-19
May
-19
Jul-
19
Sep-
19
Nov
-19
Jan
-20
Mar
-20
May
-20
Jul-
20
Sep-
20
Nov
-20
Jan
-21
Mar
-21
% c
hange Y
oY
, 3m
avg
BRC/KPMG RSM total food ONS predominately food stores (value, nsa)
12-m average, below the 12-m average of -54.4% in January.
BRC-SENSORMATIC IQ FOOTFALL MONITOR
Note: For meaningful comparisons to changes in footfall, all 2021 figures are compared with 2019 (pre-pandemic). This means our 2021 figures are now year-on-two-years (Yo2Y), rather than year-on-year (YoY). With many retail outlets bouncing between being opened and closed in 2020, comparison with 2020 would not provide any useful insight.
The UK’s footfall decline continued to soften in March at a slow pace and remains significantly below the pre-crisis “normal” levels. However, with the country still in lockdown, this was expected.
With the UK still in lockdown, Total UK Footfall decreased by 68.7% in March (Yo2Y), with only a 4.9 percentage point improvement from February
8CUSTOMER TRAFFIC – BRC-SENSORMATIC IQ FOOTFALL
SUMMARY MARCHTOTAL UK RETAIL FOOTFALL (% CHANGE with 2019)
TOTAL FOOTFALL BY CITY (% CHANGE WITH 2019)
Source: BRC-Sensormatic IQ Footfall Monitor
Source: BRC-Sensormatic IQ Footfall MonitorThe UK's footfall decline continued to soften in March.
GROWTH RANK REGION % GROWTH YOY
1 Belfast -56.6%
2 Glasgow -68.2%
3 Birmingham -68.9%
4 Cardiff -71.3%
5 London -71.4%
6 Liverpool -71.7%
7 Bristol -74.5%
8 Nottingham -74.5%
9 Leeds -76.0%
10 Manchester -83.2%
11 Portsmouth -92.1%
TOTAL FOOTFALL BY DESTINATION (% CHANGE WITH 2019)
Source: BRC-Sensormatic IQ Footfall Monitor
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
IPSOS FOOTFALL
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
-90.0%
-80.0%
-70.0%
-60.0%
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2020 2021
Year-on-Year ComparisonYear-on-Two-Year
Comparison
-100.0%
-80.0%
-60.0%
-40.0%
-20.0%
0.0%
20.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
“Confidence has edged up one point in April, with the picture for personal finances in the coming year remaining strong at +10. There is also another big uptick in our view of the general economic situation in the next 12 months, which has improved six points in April, building on the previous 13-point increase in March and 14-point jump in February.
"This clear trend of growing confidence reflects the forecast of a rebound for the UK's economy during the second half of the year. The improvement in the consumer mood since January is welcome, but the pandemic has hit household finances hard and, on the road ahead, we will still see potential concerns over new variants, rising inflation and the debt overhang. Nevertheless, there’s every chance that, as the recovery gains momentum and the numbers get stronger, confident consumers will continue to spend and drive the wheels of UK finances into the summer and beyond.”
There is growing confidence about the future of the economy.
LONG-TERM TRENDS
Source: GFK Consumer Confidence Index
Source: GFK Consumer Confidence Index
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
-70
-60
-50
-40
-30
-20
-10
0
10
20
Ap
r-1
6
Jul-
16
Oct
-16
Jan
-17
Ap
r-1
7
Jul-
17
Oct
-17
Jan
-18
Ap
r-1
8
Jul-
18
Oct
-18
Jan
-19
Ap
r-1
9
Jul-
19
Oct
-19
Jan
-20
Ap
r-2
0
Jul-
20
Oct
-20
Jan
-21
Ap
r-2
1
Ind
ex
Sco
re
Headline index Personal finances (next YR) Economy (next YR)
SUMMARY APRILECONOMIC CONFIDENCE CONTINUES TO GROW IN APRILWHICH? CONSUMER INSIGHT TRACKER
Source: Which? Consumer Insight Tracker April 2021. Data is collected via online poll for
approximately 2,000 respondents each wave. Results are weighted to be nationally representative
Confidence rose in Apr to levels as high as in Feb-20.
• Consumer confidence grew in April, continuing an upward trend throughout 2021. People’s confidence in the future of their own household finances increased compared to last month. This is the first time since the pandemic began that the score is above zero, meaning that more people are optimistic about their future finances than are pessimistic.
• Confidence in the future of the economy increased this month, which is the highest it has been since September 2016, shortly after the Brexit vote.
• The jump in confidence no doubt reflects the success of the vaccination programme, the relatively low level of infections and the easing of restrictions. Interest now is whether this confidence will lead to a consumer spending splurge that will help the UK economy to recover quickly.
CONSUMER CONFIDENCE
WILL CONSUMERS SPEND THEIR SAVINGS?
• Consumers have the money to spend. The Bank of England estimated that households saved an extra £125 billion just between March and November last year and this stock of savings will have continued to rise considerably.
• These ‘forced’ savings are not spread evenly across consumers though. In April, two-fifths of consumers said they had been able to save more over the course of the pandemic, but this was most common among those on higher incomes. This might have implications for how much of the savings are spent in the coming months as wealthier households tend to be more likely to hold on to extra savings.
• To explore this, those consumers were asked who have saved more how much of their additional savings they intend to spend over the rest of this year. The results indicate that, while we can expect spending, a large proportion of the savings is likely to be held back.
• Of those who said they had plans, more than half (52%) intend to keep more as savings than they spend. Only 29% said they intend to spend more of it and 19% said they intended to allocate the same amount to saving and spending. Those on lower incomes (a household income less than £28,000) are more likely to say they would spend more than keep as savings (35%).
• However, many people have no clear intention. Two-fifths said they don’t know yet, and those on lower incomes are much more likely to say this. 47% of those with a household income of £28,000 or less said they didn’t know how much they would spend versus save, compared to 20% of those with a household income over £55,000.
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
THOSE ALREADY ON HIGHER INCOMES ARE MORE LIKELY TO HAVE SAVED MORE DURING THE CRISIS
SUMMARY MARCHPPI OUTPUT PRICES OUTPUT PPI, CONTRIBUTIONS TO THE 12-MONTH RATE
All Output Prices (LHS)
All excl. Food, Beverages,
Tobacco & Petroleum (LHS)
Food Products (LHS)
Coke and refined petroleum products
(RHS)
Mar-20 -0.2 0.7 1.3 -18.4
Apr -1.7 0.6 0.9 -40.0
May -2.3 0.7 0.3 -45.8
Jun -1.7 0.5 0.3 -35.4
Jul -1.7 0.2 0.3 -31.5
Aug -1.7 -0.1 0.8 -32.3
Sep -1.7 0.1 1.2 -36.2
Oct -1.4 0.6 1.0 -35.0
Nov -0.6 1.0 1.7 -30.2
Dec -0.4 1.2 0.9 -25.0
Jan 0.1 1.6 0.9 -21.1
Feb 1.0 1.6 1.4 -7.9
Mar-21 1.9 1.7 1.1 13.0
Source: ONS Producer Price Index – Output Prices
Source: ONS Producer Price Index – Output Prices
PPI OUTPUT PRICES
Output prices rose for the third consecutive month in March.
Source: ONS Producer Price Index.
The factory gate price (PPI output price) is the amount received by UK producers for the goods that they sell to the domestic market. It includes the margin that businesses make on goods, in addition to costs such as labour, raw materials and energy, as well as interest on loans, site or building maintenance, or rent.
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
-50
-40
-30
-20
-10
0
10
20
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
Mar
-19
May
-19
Jul-1
9
Sep
-19
No
v-19
Jan
-20
Mar
-20
May
-20
Jul-2
0
Sep
-20
No
v-20
Jan
-21
Mar
-21
% c
ha
ng
e y
ea
r-o
n-y
ea
r
All Output Prices (LHS)All excl. Food, Beverages, Tobacco & Petroleum (LHS)Food Products (LHS)Coke and refined petroleum products (RHS)
Crude oil provided the largest upward contribution to the change in the annual rate .
Source: ONS Producer Price Index
Source: ONS Producer Price Index.
The PPI input price measures the price of materials and fuels bought by UK manufacturers for processing. It includes materials and fuels that are both imported or sourced within the domestic market. It is not limited to materials used in the final product but includes what is required by businesses in their normal day-to-day running, such as fuels.
• The estimated UK employment rate for all people was 75.1%; this is 1.4 percentage points down on the same period the previous year and 0.1 percentage points down compared with the previous quarter (September to November 2020).
• The estimated UK unemployment rate for all people was 4.9%; this is 0.9 percentage points higher than a year earlier but 0.1 percentage points lower than the previous quarter.
• The single-month and weekly estimates of the employment rate over the three-month period suggest that the rate was lowest in December and increased slightly in January and February.
• Estimates show 32.43 million people aged 16 years and over in employment, 643,000 fewer than a year earlier and down 73,000 on the quarter.
• The single-month and weekly estimates of the unemployment rate suggest that the rate decreased slightly.
• An estimated 1.67 million people were unemployed, up 311,000 on the same period the previous year but down 50,000 on the quarter, the first quarterly decrease since October to December 2019.
16LABOUR MARKET (PAGE 1)
SUMMARYLABOUR FORCE SURVEY
EMPLOYMENT (3 MONTHS ENDING)
Employment (3 months ending) (000s) Total Full-time Part-time
Between December 2019 and February 2020 and December 2020 and February 2021:
Regular pay was estimated to have increased by 0.7% in nominal terms and by -0.2% in real terms.
Average regular pay (excluding bonuses) was estimated at £534 per week in nominal terms (not adjusted for inflation), higher than the estimate for a year earlier (£511 per week) and £489 per week in real terms (constant 2015 prices), higher than the estimate for a year earlier (£471 per week), after having fallen back to £465 per week in April 2020.
Total pay was estimated to have increased by 4.8% in
nominal terms and by 3.9% in real terms.
Average total pay (including bonuses) was estimated at
£568 per week in nominal terms (not adjusted for inflation), higher than the estimate for a year earlier (£546
per week) and £518 per week in real terms (constant 2015 prices), higher than the estimate for a year earlier
(£502 per week).
Average Weekly Earnings
Consumer Price Index (CPI)
Real Average Weekly Earnings
Feb-20 2.9 1.7 1.2
Mar 2.6 1.5 1.1Apr 1.7 0.8 0.9
May 0.7 0.5 0.2
Jun -0.1 0.6 -0.7
Jul 0.2 1 -0.8
Aug 0.9 0.2 0.7
Sep 1.9 0.5 1.4
Oct 2.8 0.7 2.1
Nov 3.6 0.3 3.3
Dec 4.1 0.6 3.5Jan 4.3 0.7 3.6
Feb-21 4.4 0.4 4.0
LONG TERM EARNINGS SERIES
Note: The average weekly earnings measure used is ‘regular pay,’ which excludes bonuses
and arrears.
Pay continued to see robust growth in February, both in nominal and real terms.
Source: ONS.
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
Feb
-12
Jun-
12
Oct-
12
Feb
-13
Jun-
13
Oct-
13
Feb
-14
Jun-
14
Oct-
14
Feb
-15
Jun-
15
Oct-
15
Feb
-16
Jun-
16
Oct-
16
Feb
-17
Jun-
17
Oct
-17
Feb
-18
Jun-
18
Oct
-18
Feb
-19
Jun-
19
Oct-
19
Feb
-20
Jun-
20
Oct-
20
Feb
-21
Average Weekly Earnings (AWE) Consumer Price Index (CPI)
from capital markets in February, compared to a monthly average of £4.5 billion since March 2020. Net bank borrowing by small and medium sized businesses
was £0.4 billion in February, whilst large businesses made net repayments of £0.3 billion.
• Households continued depositing significant amounts, with an additional £17.1 billion placed in February.
Deposit interest rates remained at historically low levels.
Source: Average monthly exchange rate, Bank of England
IMPACTS FROM CURRENCY DEPRECIATION YUAN PER GBP, YEN PER GBP
Source: Average monthly exchange rate, Bank of England
Source: Average monthly exchange rate, Bank of England
If Sterling depreciates, it can buy less foreign currency and therefore fewer foreign goods. This means retailers have to pay more for imports overall. There is no impact in the short-run, however, with retailers commonly using 6-12 months hedging contracts to protect themselves against currency fluctuations. Any permanent shock to the currency - i.e. a sustained sterling depreciation - takes one to two years to feed through in final consumer prices.
From the perspective of the wider economy, in theory, a pound depreciation should also stimulate exports, since domestically produced goods are cheaper to foreigners, which would increase the demand for UK produced goods.
However, this failed to materialise following the post-referendum depreciation from 2016, most likely due to specialised supply chains.
ABOUT US
OTHER REPORTS
FORECASTS
WEATHER
EXCHANGE RATES
CREDIT & HOUSING
LABOUR MARKET P1, P2, P3
INFLATION P1, P2, P3, P4
CONFIDENCE P1, P2
CBI TRADES SURVEY
ONS
BRC vs ONS
RETAIL SALES
WORLD ECONOMY
UK – COVID-19 IMPACT
UK ECONOMY
EXEC SUMMARY
12.1%USD TO GBP, YOY
Sterling appreciation in relation to the USD , YoY.
3.6%EURO TO GBP, YOY
Sterling appreciation in relation to the Euro, YoY.
SUMMARY MARCH
Compared to last year, sterling against both the dollar and the euro.
20
US dollar ($) per pound sterling (£)
Euro (€) per pound sterling (£)
Chinese Yuan (¥) per pound sterling
(£)
Japanese Yen (¥) per pound sterling
(£)
Mar-20 1.24 1.12 8.30 133.07
Apr-20 1.24 1.14 8.70 133.69
May-20 1.23 1.13 8.67 131.93
Jun-20 1.25 1.11 8.75 134.79
Jul-20 1.27 1.11 8.92 135.44
Aug-20 1.31 1.11 9.04 139.19
Sep-20 1.30 1.10 8.67 136.84
Oct-20 1.30 1.10 8.76 136.61
Nov-20 1.32 1.12 8.73 137.92
Dec-20 1.34 1.10 8.72 139.42
Jan-21 1.36 1.12 8.87 141.52
Feb-21 1.39 1.15 9.05 146.16
Mar-21 1.39 1.16 9.02 150.67
IPSOS FOOTFALL
BRC–SENSORMATIC IQ FOOTFALL
CUSTOMER TRAFFIC
1.001.05
1.10
1.151.201.251.30
1.351.401.451.50
1.551.601.651.701.75
1.20
1.25
1.30
1.35
1.40
1.45
1.50
1.55
1.60
1.65
1.70
1.75
Mar
-17
Jun
-17
Sep-
17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Jun
-19
Sep
-19
Dec
-19
Mar
-20
Jun
-20
Sep
-20
Dec
-20
Mar
-21
Euros per £ sterling
US
$ p
er
£ S
terli
ng
US dollar ($) per pound sterling (£) Euro (€) per pound sterling (£)
LONG-TERM ECONOMIC FORECASTS, CITY, OBR AND INDEPENDENT AVERAGE
Source: City, OBR and Independent average forecasts: Long-term economic forecasts by city forecasters (average in last 3 months) & independent average from 2020 onwards, OBR.
The UK economy is projected to be smaller at the end of 2021 than in 2019.
Kyle has worked in the retail industry for nearly a decade, working on diverse projects to build a better understanding of the industry.
ECONOMIST
Liliana joined the BRC after a career in academia. At the BRC, her work focuses on economic commentary and forecasting. She holds a PhD. in Economics from Clemson University, SC, USA.
INSIGHT EXECUTIVE
Asim has worked across a diverse number of industries, from Finance to Programmatic Advertising. He holds an Actuarial Science degree from Cass Business school.
The BRC has a diverse team of experts dedicated to providing insight into the UK’s retail industry. They work across several specialities to bring together cutting-edge data sources and provide in-depth analysis of both into fast moving market developments and longer-term structural trends. We work with everyone from Amazon to Aldi, helping these organisations to better benchmark their performance against their peers.
The BRC both works with leading data suppliers and also produces some of the leading measures of UK retail performance, including sales, footfall, vacancies and more.
The dashboard below gives you a snapshot of the latest figures for retail sales and other KPIs. You can find out more about our reports by exploring the other pages in this Retail Insight & Analytics section of the website.
THE ECONOMIC BRIEFING REPORT
The BRC’s Economic Briefing Report (EBR) is our monthly measure of the global & UK economy, the wider trading environment, and a collection of performance market measures within this context.
The EBR has been running for over a decade, however the BRC are now looking to bring it into the 21st century – and are currently exploring new partnerships and data sources to make this a reality.
If you have any thoughts or feedback on how we might be able to improve this report – please do get in touch.
The articles and opinions contained in this publication do not necessarily reflect the views of
the BRC. Whilst the BRC endeavours to ensure that the information in this publication is accurate and that the articles contain nothing prejudicial to the position or reputation of any
party, the BRC shall not be liable for any damages (including without limitation, damages for loss of business or loss of profits) arising in contract, tort or otherwise from this publication or
any information contained in it, or from any action or decision as a result of reading this report.